November 20, 2016 — Editor’s Note: This article was written for our Tips & Picks section by Andrew Mastrandonas and Preston Gitlin, who lived and developed property in Costa Rica for many years (they have since moved on to other adventures). We have updated it and moved it here to the Blog so that people will have an easier time commenting on it. Their insights and advice remain true not only for Costa Rica, but for buying real estate in any foreign country. It is the First of a series.
Costa Rica is an alluring place for many people. With a terrific climate, stable and democratic government, proximity to the United States, lower cost of living, unbelievable scenery and wildlife, plus many outdoor and cultural activities, it is no wonder this country only the size of West Virginia remains one of the best in the world for retirement, investment, or a vacation. Over one million people visit Costa Rica each year generating about $1 billion in revenue for the country. Tourism surpassed coffee and bananas many years ago as the country’s top industry. For more about all aspects of this amazing country see our Costa Rica Retirement Guide.
Costa Rica Real Estate
Many of the people who visit Costa Rica are not just tourists – they’ve come to explore retirement and real estate options. A quick search of “Costa Rica real estate” on Google reveals Simonds Homes house and land packages along with over 10 million entries. Compare this to any other country on the Central American isthmus, and it’s clear that Costa Rica is first in activity related to real estate geared to foreigners. Since real estate sales are not regulated in Costa Rica —anyone can be a real estate agent or land developer — some caution is called for. Countless websites have been set up to advertise various properties. There are, of course, well known, established real estate companies like Century 21 and Coldwell Banker in Costa Rica as well.
Dreams sometimes meet an unpleasant reality
Beware emails that tell you can retire there in luxury for $1300 a month – it is not that easy. But there are many good websites where you can explore various regions, view land and homes for sale, and make contact with real estate agents and others. After spending weeks and months doing research and finding people you can trust, some folks make the trip to Costa Rica, ready to purchase their dream property. When many of them finally arrive in Costa Rica they oftentimes realize it is a much different place than they expected — sometimes for the better and sometimes for the worse. For example, they don’t realize from the stunning pictures they found on the Internet that the home of their dreams is next to an automobile repair shop. The stories go on and on.
Do Your Homework and Avoid Heartache
We find that if you do your homework before you visit you will do better. Contacting developers by email, carefully reviewing their websites, talking with others who have brought property from them, and asking a wide range of questions about their properties will likely give you a good sense as to whether you should view a particularly property. Doing the research will help guard against making an impulsive purchase that comes when people feel they must “get in now” to take advantage of rapidly escalating real estate prices. A short stay in Costa Rica is probably not enough time to make a purchase this important. Appropriate research, asking the right questions, and carefully thinking about what you want in terms of a living situation will improve your chances of finding the right property for you.
Yes, it is true that property has appreciated in Costa Rica, and faster than in many other countries. But the real estate bargains of 10 or 20 years ago are gone, unless you want to live in very small towns far away from shopping, restaurants or good medical care. So, how can you “get in now” and avoid the mistakes many people make in purchasing real estate here?
Buy Smarter with These Tips
– Take the time to get to know the country. Make it a point to talk with a wide variety of people. Get an understanding of real estate values in a particular area by seeking out real estate agents, developers, foreigners living in the area, and even locals. Stay in several different towns and get to know each of them while being mindful of your needs for shopping, medical care, entertainment, real estate, and other issues.
– Pick up some Spanish. That way you can learn directly from locals about new properties or getting real information from them about an area could prove much more valuable than hearing it from people who are in the business of trying to sell you something. Even if you speak just a little Spanish, “Ticos” will very much appreciate your efforts to communicate with them and oftentimes will go out of their way to help you.
– Retirement tours of Costa Rica. These generally provide a multi-day trip through various parts of the country, introducing foreigners to specific towns that may be suitable for retirement or finding good quality and reasonably-priced properties. On many of these tours, you’ll meet others who have already made the move to Costa Rica and purchased property. You will also meet a wider variety of real estate agents and developers than you could probably do on your own. And, just by interacting with other tour guests, you’ll learn about what other people are thinking as they consider Costa Rica for retirement, partial-year living, or investment. Caution: Beware the high-pressure tour that expects you to buy at the end!
– Meet the local professionals. Some of these tours will also introduce you to attorneys, architects, builders, and others who can be helpful to you as you consider buying. Take a look at their websites and determine if what the tour offers and the types of clients they serve seem to be geared to your lifestyle. Taking a tour is a convenient way to screen a range of properties quickly, meet experienced developers and learn about areas more quickly than you likely could do on your own. After you’ve taken a tour, definitely stay for several extra days, going back to the areas you liked on the tour or follow up with some of the people you met during the tour. Although we cannot personally vouch for them, one of the more well-known tours in Costa Rica is “Live in Costa Rica,” at http://www.liveincostarica.com.
Whether you’ve spent time on your own or took a tour you may have discovered an area or property that may be right for you. What do you do then? What factors should you consider in determining if you should purchase a property? In other words, what makes a nice community for you to enjoy for many years to come while ensuring you feel you got good value through your purchase and can trust the seller of the property?
To be continued….
Comments? Are you interested in a Costa Rica retirement? What experiences have you had in the country? Do you know of some places that might be good for your retirement? Please share your dreams and experiences in the Comments section below.